SBA program gets funding

The U.S. Senate on Thursday restored funding for the Small Business Administration's primary lending program, but the agency is considering a reduction in the maximum loan from $2 million.

The Senate approved a $9.5 billion budget for the SBA's 7(a) loan-guarantee program in 2004, part of a $373 billion spending plan covering various federal agencies for the fiscal year that began in October.

With the delay in approval, the pool for small-business loans had dried up at a time of unprecedented demand.

The SBA, operating on emergency funds, lowered the 7(a) cap to $750,000 from $2 million. Now, administrators are considering some permanent reduction in the cap.

"Demand for 7(a)s is at an all-time high," SBA spokesman Doug Heye said. "Lowering the cap is a possible way to save money to keep the program running without interruption."

Sue Hensley, another SBA representative, said the SBA should complete the review within a few days.

"Loan amounts already approved before Jan. 7 will still be honored if they were already in process," Hensley said.

That's good news for people like Lance Cooper, who runs the Best Equipment construction-tool company in Miami-Dade County.

"This is an important moment for us," said Cooper, whose $1.2 million loan from Temecula Valley Bank, a San Diego-based bank with a Coral Springs office, has awaited the SBA's guarantee for two months. "The Miami economy is at the bottom of an upswing. Now is the best time for us to expand because guys who couldn't survive the downswing are selling out."